Form 8-K UNITED ONLINE INC For: Mar 31

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of report (Date of earliest event reported): March 31, 2016

United Online, Inc.

(Exact Name of Registrant as Specified in Charter)

21255 Burbank Boulevard, Suite 400
Woodland Hills, California 91367
(Address of Principal Executive Offices) (Zip Code)

Telephone: (818) 287-3000
(Registrant’s telephone number, including area code)

N/A
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01.                                        Entry into a Material Definitive Agreement.

On March 31, 2016, Classmates International, Inc. (“Seller”), a Delaware corporation and subsidiary of United Online, Inc., a Delaware corporation (“United Online”), and Ströer Content Group GmbH, a limited liability company organized under the laws of Germany (“Purchaser”) entered into a Share Purchase Agreement, dated March 31, 2016 (the “Agreement”) regarding the sale of United Online’s European social media business.  Pursuant to the Agreement, the Seller will sell to the Purchaser all of the shares of stock in the following entities: StayFriends GmbH, a German entity, Trombi Acquisition SARL, a French entity, Klassträffen Sweden AB, a Swedish entity, and Klassenfreunde.ch GmbH, a Swiss entity (collectively, the “Social Media Business”).  The completion of the sale of the Social Media Business is subject to the satisfaction or waiver of certain conditions, including the absence of prohibitions preventing the consummation of the transaction under German antitrust laws.  The purchase price for the Social Media Business is approximately 16,000,000 Euros in cash, which includes 6,500,000 Euros of cash on StayFriends’ balance sheet, and is subject to a post-signing purchase price adjustment.  The Agreement includes customary representations, warranties and covenants of each party, some of which survive the closing of the transaction for a period of time.

The description of the Agreement set forth above is qualified in its entirety by reference to the Agreement, which United Online intends to file with the Securities and Exchange Commission.

Item 9.01.                                        Financial Statements and Exhibits.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

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EXHIBIT INDEX

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Exhibit 99.1

United Online Announces Sale of StayFriends

WOODLAND HILLS, Calif., March 31, 2016 — United Online, Inc. (NASDAQ: UNTD) (“United Online” or “the Company”), a leading provider of consumer services and products over the Internet, today announced that it has entered into a material definitive agreement with Ströer Content Group GmbH (DE: SAX) (“Ströer”), a leading provider of out-of-home and online advertising services based in Germany, to sell all of the stock of its wholly-owned subsidiaries, comprising its StayFriends’ business, the Company’s European websites for social networking products and services. The company will receive total cash consideration of 16.0 million euros, which includes 6.5 million euros of cash on StayFriends’ balance sheet.

“The anticipated sale of StayFriends is consistent with our strategy to exit the Social Media business following the sale of Classmates in August 2015,” commented Jeff Goldstein, Interim Chief Executive Officer of United Online. “In addition, we believe this outcome is another step towards our goal of maximizing shareholder value through our ongoing evaluation of strategic alternatives with JMP Securities.”

Mr. Goldstein continued, “This agreement is the culmination of a highly competitive and extensive process initiated on October 9, 2015 by our sell side advisor, ACXIT Capital Management, whereby ACXIT contacted a broad universe of potential strategic and financial buyers to maximize the value of StayFriends. The Board concluded that the agreement with Ströer was the superior value creating alternative for our shareholders.”

StayFriends includes five international websites in Germany, Sweden, Austria and Switzerland (www.stayfriends.de, www.stayfriends.se, www.stayfriends.at and www.stayfriends.ch, respectively), and Trombi in France (www.trombi.com).

The closing of the transaction is subject to Sections 35 et subseq. German Antitrust Act (Gesetz gegen Wettbewerbsbeschränkungen - GWB) and is expected to occur by April 30, 2016.  The Company does not intend to disclose further developments related to the strategic alternatives process until its Board of Directors approves a specific action or otherwise concludes the review of the strategic alternatives.

About United Online®

United Online, Inc. (NASDAQ: UNTD), through its operating subsidiaries, is a leading provider of consumer services and products over the Internet, where the company’s brands have attracted a large online audience that includes more than 40 million registered accounts. The Company’s primary Communications service is Internet access. The Company’s Commerce & Loyalty segment offers a loyalty marketing service which provides a complete web, browser and mobile shopper experience through online portals, apps and browser extensions. The Company’s Social Media segment provides social networking services and products. United Online is headquartered in Woodland Hills, CA, and operates through a global network of locations in the U.S., Germany, and India.

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Cautionary Information Regarding Forward-Looking Statements

This release contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, as amended, based on our current expectations, estimates and projections about our operations, industry, financial condition, performance, results of operations, and liquidity. Statements containing words such as “may,” “believe,” “anticipate,” “expect,” “intend,” “plan,” “project,” “projections,” “business outlook,” “estimate,” or similar expressions constitute forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding: future financial performance and results; revenues; operating expenses; operating income (loss); capital expenditures; depreciation and amortization; stock-based compensation; restructuring and dispute settlement costs; and strategic initiatives. Potential factors that could cause actual results to differ materially from those in the forward-looking statements include, among others: the effect of competition; our inability to maintain or increase our advertising revenues; risks associated with litigation and governmental regulations or investigations, including reviews of business practices such as marketing, billing, renewal, and post-transaction sales practices; risks associated with the integration or commercialization of new businesses, products, services, applications or features, or the success of new business models; our inability to maintain or increase the number of free and pay accounts, visitors to our websites, and members; problems associated with our operations, systems or technologies, including security breaches or inappropriate access to our network systems; our inability to retain key customers, vendors and personnel; changes in tax laws, our business or other factors that would impact anticipated tax benefits; as well as the risk factors disclosed in our filings with the Securities and Exchange Commission (www.sec.gov), including, without limitation, information under the captions “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors.” Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s analysis only as of the date hereof. Any such forward-looking statements are not guarantees of future performance or results and involve risks and uncertainties that may cause actual performance and results to differ materially from those predicted. Reported results should not be considered an indication of future performance. We undertake no obligation to update these forward-looking statements to reflect the impact of events or circumstances arising after the date hereof, unless required by law.

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